The elusive Product-Market Fit (PMF) - the holy grail of early-stage startups.
Every product conversation I have these days centres on the elusive PMF goal and how to get there. Don't get me wrong - PMF is an absolute must but it isn’t the only fit you need to have, at least when it comes to Product.
An excellent way to see this is as follows:
Your Product is immersed in a market. Everyone’s clear on that.
At the same time, however, that same Product is also immersed in a Channel. In other words, the primary Channel you are or will be using to distribute your product/acquire users is one of the most important environments your Product will be immersed in.
Let me use a simple analogy; let's say a 4x4 is the Product. This 4x4 is designed to cross deserts. As a result, it is big, with an enormous fuel tank and large wheels. I am going to go as far as to say that this 4x4 is perfect for the desert. It is a perfect fit for it.
Now, let's just say there is a big market of people trying to get across the desert. This market is underserved and eagerly looking for a new solution. We need to get on and sell it.
In order to sell this vehicle, the manufacturer decides to use existing dealerships that also sell other 4x4 vehicles like Land Rover and Jeep because it makes it very cost-effective to acquire leads and close deals. But there is a catch; there is always a catch. This vehicle is so big, so tremendous it just does not fit inside a normal dealership. The distribution channel is simply not able to accommodate the Product. In this case, this great Product is not fit for the Channel selected.
You are now being forced to change your Channel, but who wants to go back to the drawing board on a 4x4 that is totally fit for purpose with a massive market that is underserved? Well, let me take it to the extreme. What if I told you that the only place you can cost-effectively acquire leads for the 4x4 is through the dealerships. All other channels you have explored are simply not working or too expensive. Prospects must see the vehicle in person in that environment before they will make the purchase.
At this point you would be left with no other choice but to go back to the drawing board to change your Product, not only to be a fit for the desert (your market) but also for the dealership (your Channel).
The point that I want to make is that the Channel you plan to use to bring your Product to Market is not a marketing afterthought. You don't design a product and then find a way to sell it. The Channel you plan to use provides design constraints that your product MUST adhere to.
Let me use now a more typical example that is not made up.
Let's look at the ALS ice-bucket challenge. If you look at Product and Channel on this one, you will see a perfect fit. In this Product, when you pour a bucket full of ice water over your head, you earn the right to nominate three other friends to go through the same ordeal and make a donation. The Channel is viral referral on social media. You would post the video of you doing the deed and request the nominees to do the same. In this case, the Product and Channel are working in total harmony, supporting each other to deliver value. The videos on social keep people accountable and it’s a great way to communicate that you have nominated someone and generate virality. It’s the product feature “nomination” that makes the social Channel so powerful.
Now, imagine trying to promote the Ice-bucket challenge instead via google Adwords, with no nomination aspect. The product features don't work with, improve or complement the Channel it is immersed in. That is a clear Product-Channel unfit case.
So next time you are thinking product and PMF, take a look at your Channel and ask yourself is my Product fit for my Channel?
If you want to learn more about Product Channel Fit, feel free to contact us!
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